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Dubai: Andrew Lindstrom, Adobe's regional manager for the Middle East and Africa, recently had two e-mails from directors asking him a very simple question.
"What going on?"
The e-mails, Lindstrom says, were prompted by a recent growth in his region. Over the last two quarters Adobe, known for products such as Photoshop and Acrobat, has seen regional growth of over 200 per cent growth.
"It's not phenomenal, it's unprecedented," Lindstrom says. Annually, the company sees growth in the regional at about 60 to 80 per cent
But high growth is something Adobe expects. The company has even promised its shareholders double digit growth for the next five years. That growth is a result of Adobe's decision three years ago to focus on emerging markets. Besides the Middle East and Africa, the company is also targeting Latin America, although the focus there is mainly on Brazil -India, China, and Eastern Europe, where the company is currently seeing its biggest gains.
"I would expect by this time next year to probably have doubled the staff in the region [Latin American]," he says
Despite predictions that software companies would be hardest hit in a US recession, Adobe seems to proving the analysts wrong.
"I look at this recession, and I go clearly there is a mismatch somewhere," he says. "Last quarter, I think Adobe grew [globally] 34 per cent in a recession, whether we say it's started or it's coming".
Dramatic shift
But the shift to emerging markets has been somewhat dramatic as well as slow. Three years ago, the company had no staff in the Middle East, and very little staffing in the Africa and Middle East region. Three people handled enterprise, channel, PR and marketing. Today the company has 14 employees in the region. Adobe is also expecting to open a regional satellite office in the region.
"We're probably one of the slowest moving companies known to man," he says. "We take a long time to make decisions."
However, Adobe is playing a very aggressive catch-up game in the Middle East.
"In an emerging market where we're trying to grow our business 50 per cent year on year, it can be a little bit frustration when things aren't moving as quickly as what you'd like or as quickly as your competitors are moving."
However slow, the results are starting to show.
"We are starting make an impact," he says, predicting that the Middle East and Africa region will be bigger in terms of revenue than southern Europe in two years.
But the issue of competitors, or who they are, is somewhat of a tricky situation. Adobe's market share regionally is enormous. Lindstrom estimates 99 per cent market share for Photoshop and a 94 per cent market share for Illustrator.
But the lack of competitors and a heafty price tag for many of it products have lead to another problem, piracy, which Lindstrom lists as the company's main competitor. "They love the company. They use our products. They don't pay for our products," he says.
But Adobe's presence in the region is helping easy that.
"As soon as you start to invest in the market, people start to become aware of what you're doing, automatically you see an increase in a revenue," he says. "It's not an increase in your user base."
Another competitor for Adobe is programs, which clone Adobe's applications, but those often works to Adobe's advantage, he says. Most users quickly outgrow the clones programs, and then return to Adobe products.
"The clones are great because they seed our business," he says.
Clones won't survive long. Since most of them don't sell the technology, they rarely introduce upgrades as well.
"What will they look like in five years? Pretty much what they looked like when they started."
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